BBB’s Top 10 Scams of 2012

Published Feb 4, 2013 at 10:53 am
(Updated Feb 4, 2013 at 10:53 am)

The Better Business Bureau’s annual “Top Ten Scams” list is developed through a variety of resources. BBB gathers information on scams from consumers, some of whom have been victims of scams; from federal agencies and other reliable information sources.

“Many of these scams have been around as long as BBB – 100 years – and continue to evolve as consumers become savvier and new technologies are made available,” said Warren King, President of the Better Business Bureau of Western PA. “It is unfortunate that many scams still go unreported each year, but BBB strives to make people aware of the ones that are reported and seem to be most prevalent.”

Here are BBB’s Top Ten Scams of 2012:

• Overpayment/Fake Check Scam: Car Ads – An online ad claims you can “Get Paid Just for Driving Around” and that a company is offering $400+ per week to drive around with their logo on your car. They send a check to you, which you are to deposit in your account and wire a portion to a graphic designer who will customize your car ad. Eventually, the check bounces, a graphic designer is nowhere to be found and you are out the money you had wired. The Internet Complaint Center reported seeing this scam a lot in 2012.

• Emergency Scam: Grandparent Scam – The “Grandparent Scam” is still prevalent, in which a scammer pretends to be a grandchild, niece, nephew or friend abroad and claims that he or she is in trouble and needs money immediately. According to the FBI, it’s getting easier for scammers to tell a more plausible story due to finding real facts from the supposed victim’s life on social media. Before wiring money in an emergency, remember to check with the supposed victim or their family members to make sure they really are traveling. The odds are likely they are safe at home.

• Employment Scam: Mystery Shopping – Working as a secret shopper may sound like an ideal way to supplement income. Scammers have figured this out though and many job offers are simply a variation of the Overpayment/Fake Check Scam above. Sometimes they even claim that evaluating the wire service company is part of the job, which is why it’s required to send back part of the money. The Mystery Shopping Providers Association says it’s not the practice of its members to pre-pay shoppers, but legitimate mystery shopping positions can be found through their website.

• Advance Fee/Prepayment Scam: Nonexistent Loans – Most loan scams advertise online and promise no credit check or easy repayment terms, but require the first payment up front, purchase of an “insurance policy” or initial payment of some other kind to “secure” the loan. This year, BBB heard a new, aggressive twist on loan scams: consumers who were threatened with lawsuits and law enforcement action if they didn’t pay loans they had never actually taken out. Some even reported receiving calls at their workplace and to relatives. The embarrassment of being thought of as a delinquent caused some victims to pay even when they knew they didn’t owe money.

• Phishing Scam: President Obama Will Pay Your Utility Bills – Of all the politically-related scams, this one seemed to be very prevalent. At the peak of summer with utility costs soaring, consumers reported receiving emails, letters and even door-to-door solicitations about a “new government program” to pay utility bills. Victims “registered” with an official-looking website and provided everything scammers needed for identity theft purposes, including bank account information.

• Sweepstakes/Lottery Scam: Jamaican Phone Lottery – In this old scam that flared up again in 2012, calls come from Jamaica (area code 876) but the person claims to represent a trusted group, such as BBB or the FBI. The caller claims you’ve won a prize (typical haul: $2 million and a Mercedes Benz) but a fee must be paid in order to collect winnings. There are numerous variations on this; sometimes it’s a government grant. It is best to just hang up and file a phone fraud report with the appropriate government agency.

• Identity Theft Scam: Fake Social Media Messages – Two top social media sites were exploited in one of this year’s top scams. A direct message from a “friend” on Twitter gets sent regarding a video on Facebook, such as “ROFL they were taping you” or “What RU doing in this FB vid?” In a panic, people click on the link to see and receive an error message saying Flash or another video player needs updated. The file isn’t a new version of Flash though; it’s a virus or malware that can steal confidential information from computers or smart phones. Twitter recommends reporting such spam, resetting passwords and revoking connections to third-party applications.

• Home Improvement Scam: Sandy “Storm Chasers” – BBB spends a lot of time investigating and reporting on home improvement scams, but this year an unusual amount of “storm chaser” activity followed Super Storm Sandy. Some tree removal, roofing and general home repair companies were legitimate contractors who came from other areas for the volume of work available; others were unlicensed, uninsured and ill-prepared for the work; while some were even out-and-out scam artists who took money and never did work. In an emergency, it’s tempting to skip reference checking, but it’s never a good idea. Check out BBB’s Accredited Businesses in the home contracting field who are committed to upholding the BBB mission of trust.

• Sales/Rental Scam: Real Stars, Fake Goods – Sports memorabilia and phony tickets always make the list of top counterfeit goods, from the Super Bowl to the World Series. With the London Olympics added to the mix, it appears that 2012 was a good year for sports fakes. Some scammers sold cheap knock-offs in front of stadiums, while others set up websites that just stole money and never had goods to begin with. Counterfeit goods are not only a rip-off because the merchandise is usually shoddy, but they are also a rip-off for the teams, athletes, designers and artists who create, license and sell the real thing. Buy directly from team stores /websites, or from legitimate retailers. Remember, if a deal sounds too good to be true, it probably is.

• Scam of the Year: Newtown Charity Scams – Within hours of the horrific shooting at Sandy Hook Elementary School in Newtown, Conn., social media pages dedicated to the child victims began cropping up; some of them were scams asking for money. The FBI has already arrested one woman for posing as the aunt of one of the children killed, and state and federal agencies are investigating other possible fraudulent and misleading solicitations. In response to these reports, BBB Wise Giving Alliance offered tips for donors to understand how and when to best support those dealing with such a tragic crisis. Although the number of people defrauded and the total dollars stolen is most likely low, the cynicism and sheer audacity of these scams merit selection of it as the “Top Scam of 2012.”

For more information on these and other scams and to search for a business or charity review, visit www.bbb.org. In 2012, BBB also launched two websites to help consumers discover which offers are real and which ones are possibly frauds: BBB Smart Investing, developed in partnership with FINRA Investor Education Foundation, and BBB Scam Stopper, developed in partnership with Western Union.